Heavy selling on Wall Street has left the market uncertain. Trump’s tariffs include exemptions that have sparked considerable discussion, yet the actions appear less impactful compared to his threats, resulting in further delays.
The Nasdaq is nearing a technical breakdown, suggesting that tech shares, which dominate the current market, are in a vulnerable state. Focus is now directed towards the upcoming US jobs report and its potential effect on market sentiment.
Challenger Job Cuts Report
The Challenger job cuts report could play a role in shaping payroll figures. Although a quieter mood is present for now, volatility is expected to resurface as the trading week concludes.
The downward pressure seen in US markets has left investors wary, with sentiment shifting as traders weigh the ongoing tariff developments. While exemptions have softened the immediate blow, the uncertainty surrounding future policy adjustments continues to affect confidence. Compared to the initial rhetoric, the latest measures appear restrained, though the potential for further trade actions is far from dismissed. That hesitation is reflected in market behaviour, where selling pressure persists despite moments of relative calm.
Tech stocks remain at risk, with the Nasdaq approaching levels that could trigger a sharper downturn. Should it breach key support, momentum-driven declines could accelerate, pulling the broader market with it. With these companies holding a dominant weight in major indices, any decisive move lower could spark a wider reaction. That concern has not yet led to widespread panic, though underlying fragility is evident. The upcoming US jobs report is expected to be the next major influence, particularly in shaping expectations around economic strength and policy moves.
Labour market data has played a greater role in shaping sentiment, with even secondary reports holding more sway than in previous months. The Challenger job cuts release could provide further insight into employment trends, potentially affecting payroll expectations. While trade concerns have monopolised headlines, shifts in labour market conditions have become equally important to broader market direction. Traders have so far responded cautiously, with price movements reflecting both uncertainty and hesitation ahead of key releases.
Market Volatility Outlook
For now, a quieter tone prevails, but that does not imply stability will hold. As the week nears its end, volatility is likely to reappear, particularly if new data challenges existing assumptions. With multiple factors pulling at sentiment, reactions could be more forceful than usual.
